Quality Problems: Computer Maintenance DVD

I'm trying to output edited screen captured video I recorded using Adobe Premiere 2.0 Pro. The original screen captured video was 10fps...though it still moved smooth and it was Mpeg1 format and the dimensions are 1280x1024. I'm using Adobe's Media Encoder built into Premiere to out the edited footage to Mpeg2, 4/3, 23fps (didn't have 10), Quality set to max, no anti-noise filters, and dimensions of 720x480. When the process is finished, my final product is very blurry and you cannot read text on icons and windows. Is there a way to increase the quality of the output?

Some questions:
Should I find a way to rerecord my footage at 30fps to fix the quality?
Should I reduce the resolution of my desktop to somewhere close to 720x480 before recording, such as 640x480 or 800x600?
Should I apply some Sharpen filters to the footage I've already recorded now and then output it?

I used SnagIt to record the video of my desktop. Is there a better program that can output higher quality video besides snag-it? There are video settings within snag-it...but 30fps 1280x1024 video at Uncompressed AVI is HUGE. Maybe I could try using 800x400 to record with those settings, because 640x480 is waaay to small.

http://www.fraps.com/
The only way to go. If you are viewing the final output o a tv, realize that the resolution and quality you see on a computer monitor will never be matched when you view it on a tv unless it is a high def tv. Just not possible. If the viewing is for a computer and you want to keep the file small, final the output to a DIVX.